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Restaurant Sales Rebound to Pre-Pandemic Levels while Service Remains Elusive

June’s Restaurant Guest Satisfaction Snapshot, a monthly survey conducted by Black Box Intelligence, revealed that restaurant sales have finally returned to pre-pandemic levels. However, the survey also found some increasing signs of discontent with the restaurant industry, illustrated by a declining intent-to-return.

Let’s take a look at what’s fueling the growth and the growing challenges restaurants are facing.

Same-Store Sales Growth

For the 4th month in a row, restaurants experienced rising same-store sales, with June posting 6.6% sales growth. This growth was attributed to increasing check amounts. It appears that diners are excited to enjoy restaurants once again and not concerned about paying a little more for the experience. Note that the most significant contributor to the increase in sales came from rising check averages, not more customers.

There are a few simple strategies restaurants can use to help boost the average check size. Two of these include optimizing your menu and suggestive selling. Optimizing a menu involves placing your highest margin dishes in key areas on the menu that draw guest’s attention. Known as the “golden triangle,” guests tend to look at the middle of the menu and then at the top right and top left corners.

Suggestive selling, also known as cross-selling and upselling, requires a well-trained staff that knows their food and beverages. Get your team together for regular tastings of the menu items, particularly when there’s been a change. Upselling drinks are also one of the best strategies for increasing check averages. One app on the market, Tipzyy, trains staff on beverages while incentivizing sales right on their smartphone.

Challenge #1: Declining Traffic

While restaurant guests are spending more, June took a hit in getting customers in the doors. The survey revealed a 1.6% decrease in intent-to-return, which may result in declining guest counts. The market with the most positive intent-to-return guest sentiment was Philadelphia. They also fell into the top three markets with the highest service guest sentiment, accentuating the importance of service in the overall restaurant experience.

Orlando took the lead, once again, with the most positive sentiment in terms of food, service, and ambiance. San Francisco, one of the cities that experienced above-average pandemic disruption, saw the lowest guest sentiment based on service, food, and value. This sentiment coincided with the lowest same-store June sales growth.

Challenge #2: Service

According to Black Box, superior service is what sets the top restaurant performers apart from their competitors. Ambiance also set full-service top performers apart from the rest.

Unfortunately, June saw a slight drop in positive sentiment toward service. This decline could most certainly be caused by the current labor shortage that has left many restaurants with fewer hands than before the pandemic disruption.

Restaurants are responding to this labor shortage by increasing wages, increasing menu prices to cover the increasing wages, and reducing operating hours. Time reported on Mark Domitrovich and his three restaurants in the Chicago area. Before the pandemic, he employed about 150 people. He’s currently down 30%, leaving no option but to reduce operating times. His restaurant, Frontier, is only open four days a week, while the Ina Mae Tavern is operating at just 80% capacity.

A survey conducted by One Fair Wage revealed that over 50% of restaurant workers have considered leaving their jobs since the COVID-19 outbreak, with 76% reporting low wages and tips as the deciding factor.

Challenge #3: Food

Positive online guest sentiment about the quality and enjoyment of restaurant food increased in 2021 when compared to 2019. According to Black Box, over 50% of online posts were positive. June, however, saw a decline in positive sentiment for restaurant food. Again, this decrease may be due to the diminished labor pool and its effects on the BOH. It may also be contributed to the supply chain disruption and increasing food costs.

So, what can operators do to stem the declining positive sentiment? Fortunately, the restaurant industry attracts creative, inventive individuals that are not afraid of change. And, again, one of the answers may be training. Does your staff know the best prep techniques? Are your chefs adjusting the menu items to ensure the food is fresh and limit waste?

During the pandemic, operators and owners dreamed of the day when their restaurants and bars would, once again, fill to overflowing. Now that the day is here, unforeseen obstacles have created some unique challenges. Diners question why they’re waiting when they can see open tables. Guests blame servers when it takes too long to get their food due to labor shortages in the BOH. Some restaurants have gone so far as to post notices, explaining to their guests the industry’s current challenges.

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